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Pharma wrap | Coronavirus vaccine: How much will it really cost to immunise India?

Does government have the funds required to foot the COVID-19 vaccination bill?. Read on to know how much it could cost

September 27, 2020 / 02:58 PM IST
Representative image

Representative image

Adar Poonawalla, the CEO of Serum Institute of India, on September 26 posted a tweet, asking if the government will have Rs 80,000 crore available over the next one year to buy and distribute the Covid-19 vaccine.

"I ask this question because we need to plan and guide vaccine manufacturers both in India and overseas to service the needs of our country in terms of procurement and distribution," he further tweeted.

He added procurement and distribution of vaccines will be the "next concerning challenge we need to tackle".

Serum Institute has the licence to manufacture and distribute two vaccines in India, one is being developed by AstraZeneca - the University of Oxford and the other one by US biotech Novavax. 

AstraZeneca vaccine is undergoing phase-II and phase-III trial in India. 

How did Adar Poonawalla arrive at the figure of Rs 80,000 crore?

Poonawalla didn't mention how he arrived at the Rs 80,000-crore figure.

Earlier, Serum had announced that it will make the AstraZeneca-Oxford vaccine available at $3 for low-and-middle-income countries including India.

Moneycontrol's back of the envelope calculations, based on $3 price per dose estimate shows that Poonawalla is right.

It requires two doses of vaccine to immunise a person using the AstraZeneca vaccine. Taking the current exchange rate, the cost of immunising 130 crore people would alone cost Rs 57,486 crore. This doesn't include logistic costs like the cold chain and distribution expenses. 
Vaccines have to be preserved at low temperatures 2-7 degrees, some may need even freezing temperatures, otherwise, they lose potency. 

Recently, Zydus Cadila's Chairman Pankaj Patel told PTI that India would need to invest in manufacturing facilities to the extent of roughly Rs 3,000 - Rs 5,000 crore to create additional capacity to produce and deliver to 130 crore people.

To be sure, there are different versions for the cost of vaccinating the entire country. Whatever may be the cost, someone needs to foot the bill. It should be the government because Covid-19 is a public health emergency. 

With at least preliminary data or first reviews of phase-3 data is expected to come towards the end of this year, or early next year - the government may have to announce buying commitments, to give some clarity to manufacturers on how much manufacturing capacity they need to create for immunisation.

Viswanath Pilla
Viswanath Pilla is a business journalist with 14 years of reporting experience. Based in Mumbai, Pilla covers pharma, healthcare and infrastructure sectors for Moneycontrol.
first published: Sep 27, 2020 01:44 pm